China's Fantasia Unveils Sweeping $4.7 Billion Debt Overhaul Plan to Settle Offshore Obligations

March 14, 2026: Embattled Chinese property developer Fantasia on Friday unveiled detailed terms of its offshore debt restructuring, including plans to issue new equity, convertible bonds, and long-dated secured notes. The developer is attempting to restructure about $4.66 billion of its offshore debt through new shares, mandatory convertible bonds, and about $1.44 billion in new secured notes to settle creditor claims .

Debt Position and Restructuring Proposal

As of June 30, 2025, Fantasia had approximately 66,972 million Chinese yuan ($9.71 billion) of debt, it stated. Under the terms of the debt restructuring proposal, the Shenzhen-based developer plans to allot 5.14 billion fresh shares to scheme creditors at HK$1.52 apiece .

Fantasia will also issue zero-coupon mandatory convertible bonds worth $501.2 million, which would convert into 2.57 billion shares at the same price of HK$1.52. Additionally, the company will issue $632.5 million in secured notes due 2031 and $809.6 million due 2034—a total of $1.44 billion—both carrying a 3% coupon .

Shareholder Loan Restructuring

Fantasia will also convert the entire HK$1.31 billion ($167.36 million) shareholder loan balance by issuing 4.38 billion new shares to its controlling shareholder at HK$0.30 each, with all accrued interest permanently forgiven once the restructuring becomes effective .

Separately, controlling shareholder Baby Zeng will inject $6 million as a shareholder loan into the company with an interest of 8% per annum. These funds will be funneled towards the fees and expenses of the proposed restructuring .

Background

The property developer defaulted on its debt in 2021, among the many to have done so amid a crisis in China's real estate sector. A growing number of companies have reached restructuring agreements with their creditors as the industry continues to navigate challenging market conditions .